Euroseas Provides Spin-Off Details

Euroseas Ltd. Announces the Effectiveness of the Registration Statement and Approval for Listing on the NASDAQ Capital Market of EuroDry Ltd, its Drybulk Fleet Spin-Off

Euroseas Ltd., an owner and operator of drybulk and container carrier vessels and provider of seaborne transportation for drybulk and containerized cargoes, announced that the registration statement on Form F-1 of EuroDry Ltd., its drybulk fleet spin-off, has been declared effective by the Securities and Exchange Commission. The Company also announced that the application of EuroDry Ltd. for listing on the NASDAQ Capital Market under the symbol “EDRY” has been approved.

Currently, EuroDry Ltd. is a wholly owned subsidiary of the Company. Shares of EuroDry Ltd. will be distributed on May 30, 2018 to shareholders of record of the Company as of May 23, 2018. The Company’s shareholders will receive one share of EuroDry Ltd. for every five shares the Company they own. After the spin-off, the Company will continue owning and operating its containership fleet as the only publicly listed company focused on feeder containership vessels.

Shares of Euroseas common stock will continue to trade “regular-way” on the NASDAQ under the symbol “ESEA” through and after the May 30, 2018 distribution date. Any holder of shares of Euroseas common stock who sells Euroseas shares “regular way” through the close of trading on May 30, 2018, will also be selling their right to receive shares of EuroDry Ltd. common stock in the distribution, i.e. the purchaser of those shares will also be entitled to receive the EuroDry Ltd. shares distribution.

At the same time, Euroseas shares will also trade “ex-distribution” (that is, without the right to receive shares of EuroDry common stock in the distribution) beginning on or about May 24, 2018, and continuing through the close of trading on May 30, 2018, under the symbol “ESEAV.” Beginning on May 31, 2018, trading under symbol “ESEAV” will end and trading in Euroseas stock will reflect the distribution of EuroDry Ltd.

Furthermore, a “when-issued” public trading market for EuroDry Ltd.’s common stock will begin on or about May 24, 2018 on the NASDAQ under the symbol “EDRYV” and continue through the close of trading on May 30, 2018. Beginning on May 31, 2018, “when-issued” trading under the symbol “EDRYV” will end and EuroDry Ltd. will begin “regular-way” trading on the NASDAQ under the symbol “EDRY”

Aristides Pittas, Chairman and CEO of Euroseas commented: “We are extremely excited with the spin-off and separate listing of our drybulk fleet into a separate publicly listed company, EuroDry Ltd. As we stated in our recent earnings call, we believe that this separation will unlock the value inherent in our fleet which is currently trading at a significant discount to its net asset value (“NAV”). We believe that by forming “pure” play companies we can more easily be compared to our peers and this is expected to result in a significant increase in our value for our shareholders as our sector-focused companies should trade closer to their NAV. We also believe that separate drybulk and containership investment options will give our shareholders the flexibility to adjust their holdings, if they so wish, between the two sectors. We also anticipate that the creation of sector-focused companies will allow the capital markets to appreciate the value that our public platforms can create as consolidators in their respective fields: EuroDry Ltd., a middle range drybulk owner that owns six vessels, three of which are newbuildings, one ultramax and two kamsarmaxes, built according to our specifications in the last two years and three high-quality Panamax vessels Japanese-built post-2000; and Euroseas Ltd., the only US-listed feeder containership public company, with a fleet of eleven vessels that are proven workhorses of the sector. We also expect that both EuroDry and Euroseas will trade much closer to their net asset value, like their peers, than the combined company does now.

“We plan to take advantage of growth opportunities, as they may arise, in each of the two sectors to increase the size of each respective company as we believe that they are both well positioned to do so both in terms of their capital structure and their contract mix. Each of them being a public company with a cost-effective operating structure could be attractive to other small or large private fleets looking for opportunities to grow and obtain a public listing.”
Source: Euroseas

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